Texas Insurance Laws Questions and
Answers | Latest Version | 2025/2026 |
Correct & Verified
Who must comply with Texas insurance laws?
✔✔All licensed insurance companies, agents, adjusters, and brokers operating in the state.
What is the purpose of the Texas Insurance Code?
✔✔To provide statutory rules governing the operation and regulation of insurance in Texas.
What is a licensed insurance agent?
✔✔An individual authorized by the state to sell, solicit, or negotiate insurance policies.
What is required to become a licensed insurance agent in Texas?
✔✔Passing a state exam and completing pre-licensing education.
What is continuing education in Texas insurance law?
✔✔Required ongoing training for license renewal to maintain competence and compliance.
What is a captive insurance agent?
✔✔An agent who sells insurance exclusively for one insurance company.
What is an independent insurance agent?
1
,✔✔An agent who can sell insurance products from multiple insurers.
What is a fiduciary duty in insurance law?
✔✔The legal obligation of agents to handle premiums and funds in the best interest of clients.
What is the purpose of a surety bond in Texas insurance law?
✔✔To guarantee the performance or obligations of an insurance-related entity.
What is an insurance adjuster?
✔✔A professional who investigates and settles claims on behalf of an insurer.
Who must be licensed as an adjuster in Texas?
✔✔Anyone investigating or negotiating claims for compensation.
What is an insurance policy binder?
✔✔Temporary evidence of coverage issued before the formal policy is delivered.
What is the penalty for unlicensed insurance activity in Texas?
✔✔Fines, license denial, or legal action under the Texas Insurance Code.
What is an insurance company’s certificate of authority?
✔✔State approval allowing the company to legally operate and sell insurance in Texas.
2
, What is a producer in Texas insurance law?
✔✔A licensed agent, broker, or adjuster who transacts insurance business.
What is an insurance license suspension?
✔✔Temporary revocation of the right to conduct insurance business due to violations.
What is license revocation?
✔✔Permanent removal of legal authority to sell or service insurance policies.
What is an insurance complaint?
✔✔A formal report filed with the Texas Department of Insurance regarding an alleged violation.
What is the TDI’s enforcement authority?
✔✔Investigate complaints, impose fines, suspend or revoke licenses, and enforce compliance.
What is an insurance producer’s fiduciary responsibility regarding premiums?
✔✔To promptly remit collected premiums to the insurer without using them for personal
purposes.
What is the Texas insurance market conduct regulation?
✔✔Rules governing insurer behavior, sales practices, and consumer treatment.
3
Answers | Latest Version | 2025/2026 |
Correct & Verified
Who must comply with Texas insurance laws?
✔✔All licensed insurance companies, agents, adjusters, and brokers operating in the state.
What is the purpose of the Texas Insurance Code?
✔✔To provide statutory rules governing the operation and regulation of insurance in Texas.
What is a licensed insurance agent?
✔✔An individual authorized by the state to sell, solicit, or negotiate insurance policies.
What is required to become a licensed insurance agent in Texas?
✔✔Passing a state exam and completing pre-licensing education.
What is continuing education in Texas insurance law?
✔✔Required ongoing training for license renewal to maintain competence and compliance.
What is a captive insurance agent?
✔✔An agent who sells insurance exclusively for one insurance company.
What is an independent insurance agent?
1
,✔✔An agent who can sell insurance products from multiple insurers.
What is a fiduciary duty in insurance law?
✔✔The legal obligation of agents to handle premiums and funds in the best interest of clients.
What is the purpose of a surety bond in Texas insurance law?
✔✔To guarantee the performance or obligations of an insurance-related entity.
What is an insurance adjuster?
✔✔A professional who investigates and settles claims on behalf of an insurer.
Who must be licensed as an adjuster in Texas?
✔✔Anyone investigating or negotiating claims for compensation.
What is an insurance policy binder?
✔✔Temporary evidence of coverage issued before the formal policy is delivered.
What is the penalty for unlicensed insurance activity in Texas?
✔✔Fines, license denial, or legal action under the Texas Insurance Code.
What is an insurance company’s certificate of authority?
✔✔State approval allowing the company to legally operate and sell insurance in Texas.
2
, What is a producer in Texas insurance law?
✔✔A licensed agent, broker, or adjuster who transacts insurance business.
What is an insurance license suspension?
✔✔Temporary revocation of the right to conduct insurance business due to violations.
What is license revocation?
✔✔Permanent removal of legal authority to sell or service insurance policies.
What is an insurance complaint?
✔✔A formal report filed with the Texas Department of Insurance regarding an alleged violation.
What is the TDI’s enforcement authority?
✔✔Investigate complaints, impose fines, suspend or revoke licenses, and enforce compliance.
What is an insurance producer’s fiduciary responsibility regarding premiums?
✔✔To promptly remit collected premiums to the insurer without using them for personal
purposes.
What is the Texas insurance market conduct regulation?
✔✔Rules governing insurer behavior, sales practices, and consumer treatment.
3
